Will Italy’s tourism businesses ever fully recover from the coronavirus shutdown?

Will Italy's tourism businesses ever fully recover from the coronavirus shutdown?
The River Arno in Florence, Tuscany. Photo: AFP
The sector "will have to change" in future, business groups say, with tourism in Italy shut down completely due to the coronavirus outbreak.

Italy has long been associated with mass tourism, but Italy's tourism professionals say all of that could be set to change in future after the coronavirus pandemic turned the country into a strict no-go zone.

The resulting economic hit to one of the world's most visited nations is profound. Tourism employs an estimated 4.2 million Italians – just under a fifth of the entire official workforce.

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Italy's tourist sector was already reporting its “worst crisis in recent history” at the end of February – at the beginning of Italy's outbreak, and weeks before national lockdown measures were announced.

The question many are now asking is whether the Italian economy, and particularly the hard-hit tourism sector, will ever be the same again.

It will take “one or two years to get back to where we were,” Italy's tourism secretary Lorenza Bonaccorsi told AFP. But Bonaccorsi conceded that 2020 might as well be “written off”.


St Mark's Square in Venice standing empty in March 2020. Photo: AFP

Easter traditionally marks the real beginning of the tourist season in Italy.

Hotels are usually hiking their prices – not locking their doors for the coming weeks and possibly months

But they are closed along with all other businesses across the nation of 60 million, with the world's highest COVID-19 death toll.

The government is debating how and when to end the month-long lockdown.

But will hotels be able to draw tourists even if they were allowed to operate again?

Italy's Confturismo tourism association estimated the crisis would result in lost income of 22 billion euros.

Corti says the industry as a whole is worth 200 billion euros ($215 billion euros) a year and provides an important knock-on effect for other sectors.

“One hundred euros spent on tourism generates 86 euros in other sectors,” including the food sector and real estate, Corti said.

Even with its world-famous cuisine, culture, and weather, as well as attractions including 55 UNESCO world heritage sights, Italy may not be the tourist magnet is once was for some time – even after restrictions are lifted.

“It is still impossible to say when Italy… will come out of the health emergency,” Bonaccorsi said.

One possibility is that domestic tourists, who normally account for half of the total, will help make up some of the damage.

According to a survey done for Confturismo, seven out of 10 Italians think the crisis will be over in two or three months. Nearly half say they would then be ready to go on holiday somewhere in Italy.

But it's not yet known when the measures, including restrictions on movement, will be lifted. Some medical experts advise that social distancing must continue until the end of the year.

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Confturismo has asked the government to reduce taxes and make up for at least some of the lost revenue, Corti said

But not everyone things these measures will be enough.

Antonio Borgia, 54, a carpenter who refurbishes tourist apartments in Rome, says the numbers don't add up.

“I have to pay 800 euros in rent each month for my workshop, plus 250 for electricity, so (the government's small business handout of 600 euros is not enough, and even worse, I lose 500 euros a week due to being closed down,” he told AFP.

READ ALSO: Mafia set to profit from Italy's coronavirus devastation

“The government just postpones payments, taxes and gives us credits but if I am completely locked down, how am I going to pay them in two months time?” Borgia said.

And it is more than just an economic problem, raising issues which continue to plague Italy, especially in the poorer, more exposed south, where many autorities warn the mafia is poised to take advantage.

This is true in the tourism business as well.

Palermo prosecutor Francesco Lo Voi said “the strongest mafia groups always know how to take advantage of opportunities to make money.”

They have huge amounts of cash available, he explained, that can be invested in troubled hotels, restaurants or transport companies.

The government is also worried that richer foreign companies come will come in and buy up their Italian rivals on the cheap.

“That would mean that tourism's earnings would no longer go to Italy but to German, Japanese or American investors,” Corti said.

Crowds on the Ponte Vecchio bridge on Florence's Arno river, pictured in summer 2018. File photo: AFP

New laws announced by Conte's government on Monday are designed to stop this from happening.

“This moment of difficulty will not translate into an opportunity to prey on Italian companies,” cabinet undersecretary Riccardo Fraccaro vowed Monday.

But the government's promise has still not been put to the test.

Tourist property for rent is also seriously affected.

Chiara Ippoliti, an estate agent with Link in Rome, said “we have seen a fall of 80 to 90 percent in business since the beginning of the year and at the moment, all reservations have been cancelled.”

Most of the apartments on Airbnb in sought after areas of Rome – Monti, Trastevere or the Vatican — are run by small business people who have rented them.

“If they do not get any guests, they will not be able to pay their rent and will in turn hand them back to the owners,” she said.

The owners in turn may have no option but to try and sell their apartment in an already weak market.
Real estate agents say some 20,000 property sales in Italy have already been cancelled due to the coronavirus outbreak.

“Sometimes people have changed their mind and prefer to stay with their parents… or they have lost their job and the bank will not longer give them a loan,” Ippoliti said.

Tourism, like the economy and us all ultimately, will have to find a way of living with the coronavirus, perhaps for a long time.

Rome's Coloseum in March. Photo: AFP

How are cafes and restaurants going to ensure 'social distancing,' and prevent large groups of people gathering in the narrow streets of the historic town centres tourists come to visit?

For tourism secretary Bonaccorsi, “this might be the time to move away from mass tourism, towards one more respectful of the environment.

“You will not see the long queues outside the Colosseum you used to,” Bonaccorsi said.

The tourism association Corti also thinks the industry will have to change.

“Who will have the courage to get on a high speed Freccia Rossa (train) carriage filled with 80 passengers or a low-cost airline with 270?” Corti asked.


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